The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Sherwin-Williams missed estimates on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue increased and GAAP earnings per share expanded significantly.
Margins grew across the board.
Sherwin-Williams reported revenue of $2.60 billion. The 12 analysts polled by S&P Capital IQ expected to see revenue of $2.66 billion on the same basis. GAAP reported sales were 4.8% higher than the prior-year quarter's $2.48 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $2.24. The 18 earnings estimates compiled by S&P Capital IQ averaged $2.19 per share. GAAP EPS of $2.24 for Q3 were 31% higher than the prior-year quarter's $1.71 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 44.2%, 240 basis points better than the prior-year quarter. Operating margin was 13.4%, 230 basis points better than the prior-year quarter. Net margin was 9.0%, 180 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $2.22 billion. On the bottom line, the average EPS estimate is $1.08.
Next year's average estimate for revenue is $9.62 billion. The average EPS estimate is $6.38.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 431 members out of 484 rating the stock outperform, and 53 members rating it underperform. Among 182 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 167 give Sherwin-Williams a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Sherwin-Williams is hold, with an average price target of $140.07.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Sherwin-Williams. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.